A recent study by the LRG real estate group shows that properties in need of renovation are increasingly losing their appeal on the market. According to the collected data, only 6% of potential buyers are actively looking for properties that require significant renovation work. This indicates a clear shift in preferences in the real estate market, where ready-to-move-in solutions are evidently in ever-greater demand.
The survey, which involved over 700 buyers and sellers, also revealed that a significant majority of 53% would not undertake any major renovation work. This attitude is particularly pronounced among first-time buyers, who are especially shying away from the trend of acquiring properties in need of refurbishment. The results underscore a general aversion to the time, financial, and planning requirements associated with extensive renovations.
Preference for ready-to-occupy properties
This development has far-reaching implications for the real estate market. Properties with a modernisation backlog could be more difficult to sell in the future or might only find buyers with significant price reductions. The rising demand for ready-to-occupy houses and flats possibly reflects a desire for immediate living quality and an avoidance of the stress associated with construction projects.
The group of first-time buyers in particular, who often operate with a more limited budget and less experience in the real estate sector, seems to be avoiding the purchase of a 'doer-upper'. This could indicate that this buyer segment perceives the uncertainties and potential additional costs of a renovation as too high a risk. Instead, they prefer properties that can be occupied immediately and do not require unforeseen investments.
Impact on the market for renovation properties
The finding that 53% of respondents would not consider major renovation work shows that the market for properties with significant refurbishment needs is increasingly becoming a niche market. This could encourage investors and project developers to focus on creating turnkey solutions to meet current market demand. The LRG analysis thus offers valuable insights into the changing preferences of property buyers and the strategic reorientation that could result for market participants.
